Category: genres

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Running Out of Numbers? The Impending Scarcity of IP Addresses and What To Do About It

Edelman, Benjamin. “Running Out of Numbers: Scarcity of IP Addresses and What To Do About It.” Auctions, Market Mechanisms and Their Applications 14 (2009): 95-106. (Springer-Verlag Lecture Notes of the Institute for Computer Science.) (Featured in Working Knowledge: When the Internet Runs Out of IP Addresses) (Circulated in 2008 as Running Out of Numbers? The Impending Scarcity of IP Addresses and What To Do About It.)

The Internet’s current numbering system is nearing exhaustion: Existing protocols allow only a finite set of computer numbers (“IP addresses”), and central authorities will soon deplete their supply. I evaluate a series of possible responses to this shortage: Sharing addresses impedes new Internet applications and does not seem to be scalable. A new numbering system (“IPv6”) offers greater capacity, but network incentives impede transition. Paid transfers of IP addresses would better allocate resources to those who need them most, but unrestricted transfers might threaten the Internet’s routing system. I suggest policies to create an IP address “market” while avoiding major negative externalities–mitigating the worst effects of v4 scarcity, while obtaining price discovery and allocative efficiency benefits of market transactions.

Disclosure: I provide advice to ARIN’s counsel on matters pertaining to v6 transition, v4 exhaustion, and possible revisions to ARIN’s v4 transfer policy. But this paper expresses only my own views – not the views of ARIN, its Board, or its staff. I write on my own behalf, not for ARIN, nor at ARIN’s instruction or request.

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Ad Classification at Right Media (teaching materials)

Edelman, Benjamin. “Ad Classification at Right Media.” Harvard Business School Case 909-032, December 2008. (Revised June 2009.) (educator access at HBP. request a courtesy copy.)

Right media considers systems and policies to make sure that ads are only shown on web sites where they are appropriate, and vice versa. Setting standards is particularly challenging given the large and growing marketplace, the numerous participants, their diverse requirements, and the dynamics of policy enforcement when market participants are competing intensely.

Teaching materials:

Ad Classification at Right Media – Teaching Note (HBP 909037)

Ad Classification at Right media – Slide Supplement (HBP 911038)

Ad Classification at Right media – Slide Supplement (widescreen) (HBP 914054)

Ad Classification at Right media – Pre-Class Slides (HBP 911037)

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CPC/CPA Hybrid Bidding in a Second Price Auction

Edelman, Benjamin, and Hoan Lee. “CPC/CPA Hybrid Bidding in a Second Price Auction.” Harvard Business School Working Paper, No. 09-074, December 2008.

We develop a model of online advertising in which each advertiser chooses from multiple advertising measurement metrics–paying either for each click on its ads (CPC), or for each purchase that follows an ad-click (CPA). Our analysis extends classic auction results by allowing players to make bids using two different pricing schemes, while the driving information for bidders’ endogenous selection–the conversion rate–is hidden from the seller. We show that the advertisers with the most productive sites prefer to pay CPC, while advertisers with lower quality sites prefer to pay CPA–a result that may be viewed as counterintuitive since low quality sites cannot proudly tout their conversion rates. This result holds even if an ad platform’s assessment of site quality is correct in expectation. We also show that by offering both CPC and CPA, an ad platform can weakly increase its revenues compared to offering either alternative alone.

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Typosquatting: Unintended Adventures in Browsing

Edelman, Benjamin. “Typosquatting: Unintended Adventures in Browsing.” Cybercrime Gets Personal, McAfee Security Journal (fall 2008): 34-37.

Typosquatting is the practice of registering domain names, identical to or confusingly similar to trademarks and famous names, in hopes that users will accidentally request these sites–whereupon they will receive, typically, advertisements. This piece presents the basic typosquatting business model, based on my analysis of more than 80,000 typosquatting domain names. I analyze the advertising intermediaries that make typosquatting profitable, and I assess the legislation and litigation that are beginning to put a check on this practice.

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Consumer Payment Systems — Japan (teaching materials) with Andrei Hagiu

Edelman, Benjamin, and Andrei Hagiu. “Consumer Payment Systems — Japan.” Harvard Business School Case 909-007, August 2008. (Revised May 2009.) (educator access at HBP. request a courtesy copy.)

In 2008, the Japanese consumer payments landscape featured ongoing widespread use of cash, limited use of credit cards and rapid rise of e-money systems based on contactless technology embedded in cards and especially mobile phones. The case details the alliances that created new products, as well as the regulations that sometimes stood in the way. Throughout, the case identifies incentives for both consumers and merchants, including direct costs, efficiency benefits, rebates, and treatment in case of loss or fraud.

Teaching Materials:

Consumer Payment Systems — United States and Japan – Teaching Note (HBP 909039)

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Consumer Payment Systems — United States (teaching materials) with Andrei Hagiu

Edelman, Benjamin, and Andrei Hagiu. “Consumer Payment Systems — United States.” Harvard Business School Case 909-006, August 2008. (Revised July 2011.) (educator access at HBP. request a courtesy copy.)

In 2008, the U.S. consumer payments landscape was characterized by the ongoing prevalence of credit and debit card networks, the decline of checks, the rise of stored value cards, and the growth of new payment methods such as PayPal, Bill Me Later, and decoupled debit. This case presents the structure of these payment methods, focusing on incentives for both consumers and merchants, including direct costs, efficiency benefits, rebates, and treatment in case of loss or fraud.

Teaching Materials:

Consumer Payment Systems — United States and Japan – Teaching Note (HBP 909039)

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Competition among Sponsored Search Services

Edelman, Benjamin. “Competition among Sponsored Search Services.” U.S. House of Representatives, Committee on the Judiciary, Task Force on Competition Policy and Antitrust Laws, 2008. (Hearing cancelled.) (Reprinted in Working Knowledge: Google-Yahoo Ad Deal is Bad for Online Advertising.)

Last month I was asked to testify to the United States House of Representatives Committee on the Judiciary Task Force on Competition Policy and Antitrust Laws about competition among paid search providers, particularly the proposed Google-Yahoo partnership.

At the last minute, the hearing was cancelled, and I won’t be able to testify at the rescheduled session. Rather than let my draft written statement languish, I’m taking this opportunity to post the prepared testimony I had planned to offer:

Competition among Sponsored Search Services.

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Microsoft adCenter (teaching materials) with Peter Coles

Coles, Peter, and Benjamin Edelman. “Microsoft adCenter.” Harvard Business School Case 908-049, January 2008. (Revised February 2010.) (educator access at HBP. request a courtesy copy.)

Microsoft considers alternatives to expand its presence in online advertising, especially text-based pay-per-click advertising. Google dominates, and it is unclear how Microsoft can grow, despite considerable technical and financial resources. Microsoft considers a set of alternatives, each with clear benefits but also serious challenges.

Teaching Materials:

Microsoft adCenter (Teaching Note) – HBP 908062

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TheLadders (teaching materials) with Peter Coles, Brian Hall, and Nicole Bennett

Coles, Peter A., Benjamin Edelman, Brian J. Hall, and Nicole Bennett. “TheLadders (A).” Harvard Business School Case 908-061, April 2008. (Revised March 2015.) (educator access at HBP. request a courtesy copy.)

Despite strong appeal among job seekers and outside recruiters, TheLadders’ corporate job listings seem to lag. Could raising prices help solve the problem? TheLadders considers this strategic paradox.

Supplments:

The Ladder (B) – Supplement (HBP 914017)

The Ladder (C) – Supplement (HBP 916017)

Teaching Materials:

The Ladder – Teaching Note (HBP 909005)

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Opening Dot EU (teaching materials)

Edelman, Benjamin. “Opening Dot EU (A).” Harvard Business School Case 908-052, March 2008. (Revised April 2008.) (educator access at HBP. request a courtesy copy.)

EURid considers possible market mechanisms to allocate initial domain names within the Internet’s newly-created “dot EU.” European Union regulations and community norms substantially constrain EURid’s approach, preventing the use of the most natural economic mechanisms (such as auctions).

Supplement:

Opening Dot EU (B)- Supplement (HBP 908053)